AIR - Air NZ.

[Waltzing]

And last but not least ...

https://www.youtube.com/watch?v=JjokXtoiQd4

[Sideshow Bob]

:scared:

Air New Zealand 2022 Interim Results - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/387838)

Interim results summary
• A statutory loss before taxation of $376 million for the six-month period ending 31 December 2021
• Operating revenue 9 percent lower than the prior period, driven by a 26 percent decline in passenger revenue due to the national alert level restrictions and 107-day Auckland lockdown
• Cargo revenue increased 29 percent on the same period last year to $482 million, supported by Government freight support schemes
• Fuel costs increased 14% to $174 million for the half year, with the increasing cost of fuel expected to impact the second half
• Drawings under Crown Standby Loan Facility (the Crown Facility) are $760 million as at 23 February 2022
• Liquidity of $1.4 billion as at 23 February 2022, made up of approximately $170 million of cash and $1.24 billion of available funds under the remaining Crown Facility and Redeemable Shares
• Steps to recapitalise the balance sheet are underway including an equity capital raise that is intended to be launched by the end of March 2022 or shortly thereafter, subject to market conditions
• Dividends remain suspended
• Current expectation for the full 2022 financial year is a loss before taxation and other significant items that will exceed $800 million

[Sideshow Bob]

This thing is still running on fumes......8th wonder of the world how it is trading in the $1.50-1.60's.....

[percy]

This thing is still running on fumes......8th wonder of the world how it is trading in the $1.50-1.60's.....

Incredible.............................????

[BlackPeter]

:scared:

Air New Zealand 2022 Interim Results - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/387838)

Interim results summary
• A statutory loss before taxation of $376 million for the six-month period ending 31 December 2021
• Operating revenue 9 percent lower than the prior period, driven by a 26 percent decline in passenger revenue due to the national alert level restrictions and 107-day Auckland lockdown
• Cargo revenue increased 29 percent on the same period last year to $482 million, supported by Government freight support schemes
• Fuel costs increased 14% to $174 million for the half year, with the increasing cost of fuel expected to impact the second half
• Drawings under Crown Standby Loan Facility (the Crown Facility) are $760 million as at 23 February 2022
• Liquidity of $1.4 billion as at 23 February 2022, made up of approximately $170 million of cash and $1.24 billion of available funds under the remaining Crown Facility and Redeemable Shares
• Steps to recapitalise the balance sheet are underway including an equity capital raise that is intended to be launched by the end of March 2022 or shortly thereafter, subject to market conditions
• Dividends remain suspended
• Current expectation for the full 2022 financial year is a loss before taxation and other significant items that will exceed $800 million

{\irony on}

Well, cargo revenue increased, fuel costs increased and looking forward to another peak loss of >$800m nearly trying to compete with the ATH of 2020 ... all up, this must be good, isn't it?

As well - CEO sees light ahead ...


Despite the remaining uncertainty around future travel demand and ongoing impacts on financial performance, Mr Foran can see light ahead for the airline.

“Looking at what is happening around the world and at home, we can see the path back to the Revive phase of our Survive, Revive, Thrive plan. We have the right strategy, the right people and we are ready to fly. We’re excited about welcoming Kiwis home in the coming days and months and international travellers back to Aotearoa later in the year.”


Lets hope it is no mirage;

Must be a buy ... only disappointment - no divie :p;

{\irony off}

OK - I am sure tax payers will keep them alive, no matter the cost and it is clearly in NZ's interest to have an operating Airline.

Just a pity the government missed the opportunity to get rid of the ballast and turn this into a light and agile carrier. So many superfluous and overpaid pigs feeding at the trough ...

[Stranger_Danger]

If anyone still believes in Efficient Market Theory, perhaps a small look at Air NZ would do them some good.

[Dassets]

AIR has no professional investors( or semi) or fund managers who aren't indexers left. There is still a bunch of buyers(unnamed but people can guess) in there day after day who have plowed close to $180m in it so far without knowing it is worthless.

As for the CEO, I am tempted to count the number of times he has said there is light at the end of the tunnel. Problem Mr Foran the light isn't getting closer. You are stationary in the tunnel and have run out of Jet A1.

[Sideshow Bob]

AIR has no professional investors( or semi) or fund managers who aren't indexers left. There is still a bunch of buyers(unnamed but people can guess) in there day after day who have plowed close to $180m in it so far without knowing it is worthless.

As for the CEO, I am tempted to count the number of times he has said there is light at the end of the tunnel. Problem Mr Foran the light isn't getting closer. You are stationary in the tunnel and have run out of Jet A1.

I do feel sorry for Greg Foran however. Got to appear upbeat, but had only a few days starting at the helm before Covid hit. Terrible circumstances, unprecedented situation and from the outside appears to have done a creditable job. Hamstrung by Govt's fortress mentality.

[Recaster]

This company should have gone into receivership early on in the coronavirus saga. It could have started from there as a much smaller airline.

Not sure if the government guarantees its leases though. It could have restructured its whole operation. Maybe walked on some of the pensions.

It'll end up costing the taxpayer a few billion when all is said and done.

Nation pride in this case is national folly. Still the socialist dream is to make all dependent on the state.

Not massive compared to the 57 billion dollars of falling bonds the rbnz is stuck with I guess.

[Beagle]

In terms of the potential for capital destruction, this is arguably the highest risk investment on the NZX.

[Beagle]

AIR has no professional investors( or semi) or fund managers who aren't indexers left. There is still a bunch of buyers(unnamed but people can guess) in there day after day who have plowed close to $180m in it so far without knowing it is worthless.

As for the CEO, I am tempted to count the number of times he has said there is light at the end of the tunnel. Problem Mr Foran the light isn't getting closer. You are stationary in the tunnel and have run out of Jet A1.

+1...you have summed up the situation perfectly.

[percy]

AIR has no professional investors( or semi) or fund managers who aren't indexers left. There is still a bunch of buyers(unnamed but people can guess) in there day after day who have plowed close to $180m in it so far without knowing it is worthless.

As for the CEO, I am tempted to count the number of times he has said there is light at the end of the tunnel. Problem Mr Foran the light isn't getting closer. You are stationary in the tunnel and have run out of Jet A1.

Well he can not admit they are up sh*t creek without a paddle.

[Sideshow Bob]

Well he can not admit they are up sh*t creek without a paddle.

in a barbwire canoe! :scared:

[Beagle]

in a barbwire canoe! :scared:

:lol: :lol: That's surely the best post of the week, maybe even the post of the year !

[LaserEyeKiwi]

Big news just mentioned in the live health briefing: possibility that self isolation requirements for people entering New Zealand may disappear altogether within the month (minister: “expecting to receive advice on that within the next week or two”)

This would be a significant event for the restart of international tourism into NZ.

[Dassets]

I have commented on length on the NTA issue. Excluding a cap raise FY22 year end NTA almost certain to be basically zero. Go look what the company said about the effect of Auckland lock down and trans-tasman closure. It is easy to work out.

This is back from mid-Nov on the NTA issue. I will also repeat AIR will lose money at least until FY25, unless it does an almighty cost out. Why? Just because you fly plane on a route doesn't mean you make money. Load factor break even I can only guess cause haven't modelled for over 20 years but probably 60% under the old rules when business seats paid for alot of the flight. Note today's announcement on re-hiring aka costs. Cost out exercise coming doesn't reconcile with that re-hiring.

I predict(not forecast under FMA rules lol) 2-3 cap raises. 1st, the "Light at the End of Tunnel" raise, 2nd, the "Almost at the End of the Tunnel, Just got to get There" raise and finally the "Recovery Opening up Opportunities(but we are cash-flow negative and just need some money brother because we been flying for no cash cause of them pesky credits) " raise. $3 to 4 billion in total. "Welcome to my parlour boys" Quote JA 2022.

[Beagle]

This is back from mid-Nov on the NTA issue. I will also repeat AIR will lose money at least until FY25, unless it does an almighty cost out. Why? Just because you fly plane on a route doesn't mean you make money. Load factor break even I can only guess cause haven't modelled for over 20 years but probably 60% under the old rules when business seats paid for alot of the flight. Note today's announcement on re-hiring aka costs. Cost out exercise coming doesn't reconcile with that re-hiring.

I predict(not forecast under FMA rules lol) 2-3 cap raises. 1st, the "Light at the End of Tunnel" raise, 2nd, the "Almost at the End of the Tunnel, Just got to get There" raise and finally the "Recovery Opening up Opportunities(but we are cash-flow negative and just need some money brother because we been flying for no cash cause of them pesky credits) " raise. $3 to 4 billion in total. "Welcome to my parlour boys" Quote JA 2022.

Agree, this is basically AIR's "financial" Mt Erebus disaster event and it will take many years and many billions get though this. The Govt take many, many hundreds of millions per annum out of AIR in good times with GST, PAYE for staff, Company Tax and dividends so I see no reason for help them subsidize the losses. Anyone who is stumping up for the capital raise for AIR should ask if they're a registered charity so their donation will confer them some tax relief lol

[LaserEyeKiwi]

https://www.stuff.co.nz/national/politics/300525636/covid19-nz-border-rules-government-reviewing-selfisolation-for-travellers-as-cases-mount


Tourism Industry Aotearoa (TIA) spokeswoman Ann-Marie Johnson said it was reassuring to hear the Government was reviewing self-isolation requirements for international arrivals.Having isolation requirements in place meant New Zealand was off the radar for international tourists, she said.

“With the move to phase three of the Omicron response, the rationale for keeping self-isolation rules in place no longer exists,” Johnson said.

TIA was working on an evidence-based case for removing self-isolation requirements and would provide it to the Government as soon as possible, she said.

[Dassets]

If anyone still believes in Efficient Market Theory, perhaps a small look at Air NZ would do them some good.


https://www.stuff.co.nz/national/politics/300525636/covid19-nz-border-rules-government-reviewing-selfisolation-for-travellers-as-cases-mount

Was in the viaduct for lunch today. Only went there because most other places are closed. Most of the viaduct is closed also. Very few people around, less than the last lock down. Be nice if a govt minister had a look around at the devastation. In Australia they show up for the big fires. Here there is an invisible fire so no one shows.....

[dobby41]

Was in the viaduct for lunch today. Only went there because most other places are closed. Most of the viaduct is closed also. Very few people around, less than the last lock down. Be nice if a govt minister had a look around at the devastation. In Australia they show up for the big fires. Here there is an invisible fire so no one shows.....

People can go if they wish - they choose not to.
Melbourne CBD is pretty empty too.
I've done my bit in the Waikato this week.

[LaserEyeKiwi]

Was in the viaduct for lunch today. Only went there because most other places are closed. Most of the viaduct is closed also. Very few people around, less than the last lock down. Be nice if a govt minister had a look around at the devastation. In Australia they show up for the big fires. Here there is an invisible fire so no one shows.....

Can’t blame the general public from avoiding unnecessary public activity during the peak Omicron wave. I won’t be visiting a bar/eatery for the next 4 weeks thats for sure.

[Sideshow Bob]

AIR got $194m from the Govt as part of the MIAC scheme for airfreight. Take that out of the mix and looks a bit sicker.

I guess their proposed route for the Dreamliner to Kiev is off the table for the moment....

[mikelee]

Very little chance of Air NZ going back to Europe I reckon, other than in the form of co-shares. The focus appears to be on North America for the last and current CEO.

[dobby41]

Very little chance of Air NZ going back to Europe I reckon, other than in the form of co-shares. The focus appears to be on North America for the last and current CEO.

They sold their Heathrow slot which is their natural destination.

[Airw0lf]

Was in the viaduct for lunch today. Only went there because most other places are closed. Most of the viaduct is closed also. Very few people around, less than the last lock down. Be nice if a govt minister had a look around at the devastation. In Australia they show up for the big fires. Here there is an invisible fire so no one shows.....Yes, this is what opening up looks like in a pandemic (hopefully the tail end of the pandemic.) A lot of people criticised the government for shutting everything down in previous lockdowns. Now you really aren't prevented from doing anything (aside from 100+ person gatherings I think) but that doesn't mean people will just revert to normal pre-pandemic life. Even if you removed every single Covid-19 related restriction (100+ level limit, contact tracing, masks, QR codes, etc.) you still won't necessarily fix the lack of attendance. People will still be influenced by hospitalisations, friends and family getting sick, case numbers, etc. I'm not really sure what you expect the government to do?

[winner69]

you have to love old AIR or NAC posters

Betcha Air wishes that 'everyone flies these days' was happening

But when I saw this I thought yes we possibly will see a nationalised airline again

[Beagle]

Love how you dig out memorabilia from the old days.

This was my favorite safety video from much happier times...I just spent 4 minutes enjoying it again, probably just as well Mrs Beagle didn't catch me lol Why not take a break from this crazy world and relive happier times...
https://www.youtube.com/watch?v=q0tkeGPG_8Q
In this mental world of all things extreme PC they probably wouldn't even be allowed to make or screen a video like this now days.

[nztx]

Here's another AIR Safety Video - perfectly crafted for backing things
out of the mire from hibernation:
https://www.youtube.com/watch?v=qOw44VFNk8Y

[Maxtrade]

Cap Raise sounding like not far off now. Ready for a bit of an avalanche. Still surprised there are that many 'punters' out there looking to support SP @ 1.5. Might be very disappointed once we see what the cap raise comes out at.

Disc. Dumping all remaining shares. Too many parameters stacked up not in favour of AIR making any money or even getting out of their whole for the unforeseeable future, even when international travel resumes. Higher fuel prices, will be counter productive to profits. Air flights will go up in cost/price, continuing to deter people from travelling further even once open. Many long haul flights won't be re-established. Don't see the point in investing on hope for the name of Air New Zealand. Many simply seem too be placing their faith in boarders reopening and that's all they are factoring in. Missing the bigger picture of all involved.

[Sideshow Bob]

Almost like AIR needs to make a profit to make the share price decrease!! :scared: Keep flying (realtively) high on bad news. Seems like no matter how much they lose, what their costs are, what capital raise is in prospects, they keep on flying.

Not sure what degree they are hedged, but fuel has to be hurting them (as all other airlines).

[winner69]

If one had $10,000 AIR shares today I wonder what that $10,000 will be in a few months ….bearing in mind one might be tempted to put more cash in to get cheap shares at cap raise time.

[nztx]

If one had $10,000 AIR shares today I wonder what that $10,000 will be in a few months ….bearing in mind one might be tempted to put more cash in to get cheap shares at cap raise time.


Recent media reports suggest that Russian stocks are probable candidates in the race to find the bottom ..
Just goes to show what a bit of Robertson hot air can do in not so freezing climates ;)

[BlackPeter]

Recent media reports suggest that Russian stocks are probable candidates in the race to find the bottom ..
Just goes to show what a bit of Robertson hot air can do in not so freezing climates ;)

Well, yes - one AIR share already worth nearly 120 Russian Rubles. While I think that AIR is overpriced, so is the Russian Ruble. Well be interesting which of these two "security" finds its bottom first.

[mikelee]

Cap Raise sounding like not far off now. Ready for a bit of an avalanche. Still surprised there are that many 'punters' out there looking to support SP @ 1.5. Might be very disappointed once we see what the cap raise comes out at.

Disc. Dumping all remaining shares. Too many parameters stacked up not in favour of AIR making any money or even getting out of their whole for the unforeseeable future, even when international travel resumes. Higher fuel prices, will be counter productive to profits. Air flights will go up in cost/price, continuing to deter people from travelling further even once open. Many long haul flights won't be re-established. Don't see the point in investing on hope for the name of Air New Zealand. Many simply seem too be placing their faith in boarders reopening and that's all they are factoring in. Missing the bigger picture of all involved.

On top of not having to quarantine or isolate. I for one would like to see pre-departure/arrival testing be either free or heavily subsidised. Otherwise economy class tourist will not likely come back in a hurry. Also, now that the airline is under another US biased CEO the outlook for haul will probably be very US-centric by pulling away from unprofitable Asian routes.

[BlackPeter]

On top of not having to quarantine or isolate. I for one would like to see pre-departure/arrival testing be either free or heavily subsidised. Otherwise economy class tourist will not likely come back in a hurry. Also, now that the airline is under another US biased CEO the outlook for haul will probably be very US-centric by pulling away from unprofitable Asian routes.

Actually - US bias might be these days a good thing.

Most long haul customers from here probably want to go to Europe or the UK ... and given the situation in Russia / Ukraine is it much safer to fly via the Americas to Europe instead of choosing the route over Asia / Russia / Ukraine. Ah yes, and pulling away from unprofitable routes always sounds like a good idea, no matter where the centre of the CEO lies :p ;

[Dassets]

Well it is coming up to crunch time. I am short well in excess of 100.000 units now. Just waiting watching the ups and down ala sharsies. Soon I will either be right or wrong. I will short more as we get closer.

[nztx]

Well it is coming up to crunch time. I am short well in excess of 100.000 units now. Just waiting watching the ups and down ala sharsies. Soon I will either be right or wrong. I will short more as we get closer.


I'm flying well clear to avoid projectiles likely out of the ensuing bun fight to emerge :)

[Popeye]

Cannot help but agree with the sentiment on AIR. I was shocked this did not reach the $0.30-$0.50 range in March 2020, from memory $1 was as low as it went. I was ready to take a position at around $0.30 but the market disagreed and still does. At lease until the capital raise...

[ados_nz]

Well it is coming up to crunch time. I am short well in excess of 100.000 units now. Just waiting watching the ups and down ala sharsies. Soon I will either be right or wrong. I will short more as we get closer.

100,000.... impressive!

I'm sitting on a small 20,000 shares short.

[Recaster]

The company needs to raise capital (equity) soon.

Very basic set of analyses:

Interims to 31 December, 2021

https://recastinvestor.substack.com/p/update-air-new-zealand-airnzx

Annuals to 39 June, 2021

https://recastinvestor.substack.com/p/basic-analysis-air-new-zealand-airnzx

Feedback welcome :-)

[nztx]

The company needs to raise capital (equity) soon.

Very basic set of analyses:

Interims to 31 December, 2021

https://recastinvestor.substack.com/p/update-air-new-zealand-airnzx

Annuals to 39 June, 2021

https://recastinvestor.substack.com/p/basic-analysis-air-new-zealand-airnzx

Feedback welcome :-)



A few further comments:

Forget creative deferred tax movements (in fact any tax) in P&L for this basket case
Net Profit before tax is a more appropriate measure of performance
in current times.

Fixed Assets should be valued at their fire sale values in the
current economic & global climate - that is values near to what
a Liquidator would see as realisation values

Impairment provisions to bring down to their Fair Value may be
substantial.

It's surprising that SHF for 2021 were $811M

They probably wouldn't be that now - adjust for reversing back out creative
deferred tax ($53m) , further months & months of travel carnage, fuel increases,
wage increases, Covid, Omicron possible derivatives unfavourably moving etc etc

It wouldn't surprise if the $800 m odd was all but evaporated by the time
CR comes along - what sort of SP true value does that suggest ?

No sense in Directors or the Company trying to further pull the wool
over the public & investor's eyes - the situation is indeed grim.

No amount of white washing can change things IMO

[Beagle]

Wonder how many hundreds of millions extra per annum in fuel costs with the recent explosion in fuel prices ?
I can't be bothered going too deep on this any more....anyone thinking rationally about it should be able to see the capital raise is just a non tax deducible donation and if they can't see what they're looking at jumping into they should be taking professional advice.

[Recaster]

Great points. Thanks. Not that familiar with deferred tax - I need to brush up on that. If you take out the tax credit it's not a pretty picture for just 6 months of operation. A indirect cash flow statement reconciling profit to operating cash flow would have been quite revealing.

Based on your comments the company must be nearly insolvent if not insolvent. Perhaps $1.2 bn will be no where near enough. They've got an NZ govt 'put' though :-)

[Beagle]

Been a while since this aging bean counter looked at the rules around deferred tax but in essence if my memory serves me correctly you're only allowed to recognize a credit if there's a realistic chance the benefit of these losses can be realized in the foreseeable future, or words pretty close to that effect. But what year does anyone think AIR will be profitable again and in a position to utilize the value of prior years tax losses ? I don't see how anyone with a straight face could say they'll be profitable any year soon ?

To me "Revive and thrive" looks like nothing more than a creative B.S. marketing phrase to try and sell the recovery to some of the gullible public. In my opinion that's analogous to the disingenuous way promotors of My Food Bag extolled naïve investors to "Tuck In" Look how that's worked out for them ! They've lost half their money....and I'd say AIR investors would be very fortunate indeed if over time, they escaped with a similar outcome.

In my opinion if you want an almost sure fire way to get seriously kicked in the head financially, rock up and fill ya boots with AIR shares tomorrow and take up your full entitlement to the capital raise in due course.

[Waltzing]

Could see some big air freight increases but that will likely be passed on to everyone using the services of of Air freight.

Just got a bill for parts from Italy, 50 EU part , 250 NZ for Air freight. Parts weight almost Nothing and pretty small package..

[Recaster]

Thanks for the comments! Just on the subject of deferred tax wouldn't it be better to record them as contingent assets or liabilities as the case may be? Take them off the balance sheet and put them in the notes to the accounts in other words.

[BlackPeter]

Wonder how many hundreds of millions extra per annum in fuel costs with the recent explosion in fuel prices ?
I can't be bothered going too deep on this any more....anyone thinking rationally about it should be able to see the capital raise is just a non tax deducible donation and if they can't see what they're looking at jumping into they should be taking professional advice.

beagle, fully agree re your assessment of AIR.

Only thing I would like to point out that for a trader any contributions to AIR's CR would be in my view fully tax deductible. Why do you think any trader would not be allowed to deduct their AIR incurred losses from their income and therefore pay less overall tax?

Obviously for any investor (not subject to capital gains tax) as well as for traders on lower tax rates than 33% the situation would be more complicated and a donation to the local church or welfare organisation within the defined limits of the tax law more sensible ... IF tax deductibility is one of the drivers of the donation.

[Muse]

Been a while since this aging bean counter looked at the rules around deferred tax but in essence if my memory serves me correctly you're only allowed to recognize a credit if there's a realistic chance the benefit of these losses can be realized in the foreseeable future, or words pretty close to that effect. But what year does anyone think AIR will be profitable again and in a position to utilize the value of prior years tax losses ? I don't see how anyone with a straight face could say they'll be profitable any year soon ?

To me "Revive and thrive" looks like nothing more than a creative B.S. marketing phrase to try and sell the recovery to some of the gullible public. In my opinion that's analogous to the disingenuous way promotors of My Food Bag extolled naïve investors to "Tuck In" Look how that's worked out for them ! They've lost half their money....and I'd say AIR investors would be very fortunate indeed if over time, they escaped with a similar outcome.

In my opinion if you want an almost sure fire way to get seriously kicked in the head financially, rock up and fill ya boots with AIR shares tomorrow and take up your full entitlement to the capital raise in due course.

You can only record on balance sheet tax losses that the accountants & auditors agree have a realistic chance of being utilised over some period of time. But off balance sheet tax credits are still available for use in the future regardless if they are on the balance sheet or not.
One thing to consider though is the potential loss of tax credits from changes in shareholder continuity. If there is a turnover of more than 50% of shares in a year then the credits will be lost.

[Beagle]

You can only record on balance sheet tax losses that the accountants & auditors agree have a realistic chance of being utilised over some period of time. But off balance sheet tax credits are still available for use in the future regardless if they are on the balance sheet or not.
One thing to consider though is the potential loss of tax credits from changes in shareholder continuity. If there is a turnover of more than 50% of shares in a year then the credits will be lost.

Thanks mate, its good to have another bean counter on here to confirm my understanding. There could be some frank discussions between the auditors and management this year !

[Beagle]

beagle, fully agree re your assessment of AIR.

Only thing I would like to point out that for a trader any contributions to AIR's CR would be in my view fully tax deductible. Why do you think any trader would not be allowed to deduct their AIR incurred losses from their income and therefore pay less overall tax?

Obviously for any investor (not subject to capital gains tax) as well as for traders on lower tax rates than 33% the situation would be more complicated and a donation to the local church or welfare organisation within the defined limits of the tax law more sensible ... IF tax deductibility is one of the drivers of the donation.

Agree regarding traders but I think their tax deductible donation would be better off directed towards a more worthwhile cause. I am sure the Red Cross are doing fabulous work in Poland at the moment.

[Stranger_Danger]

Wonder how many hundreds of millions extra per annum in fuel costs with the recent explosion in fuel prices ?
I can't be bothered going too deep on this any more....anyone thinking rationally about it should be able to see the capital raise is just a non tax deducible donation and if they can't see what they're looking at jumping into they should be taking professional advice.

From a psychiatrist?

[Beagle]

From a psychiatrist?

:lol: :lol: Not a good idea to deliberately inflict pain on yourself. Stumbled across this today....might help someone owning too much of the pain and problems in their organization https://www.bing.com/videos/search?q=wanting+to+inflict+opain+on+yourself&docid=608004555752480020&mid=AC9D8FDE554E664577DFAC9D8FDE554E664577DF&view=detail&FORM=VIRE

[Snow Leopard]

Air New Zealand out of the OZ All Ords - that is a major achievement.

https://stocknessmonster.com/announcements/aiz.asx-3A589203/

[Dassets]

Thanks mate, its good to have another bean counter on here to confirm my understanding. There could be some frank discussions between the auditors and management this year !
The continuity rule has changed but the year of the loss and when the change occurred have some limitations.

[Dassets]

Thanks mate, its good to have another bean counter on here to confirm my understanding. There could be some frank discussions between the auditors and management this year !


Air New Zealand out of the OZ All Ords - that is a major achievement.

https://stocknessmonster.com/announcements/aiz.asx-3A589203/

What is the current weighting and what date? This removal could be a price mover if any indexers use that as bench.

[Beagle]

Usually most of the action in terms of index tracking funds happens in the 15 minute closing price match process the Friday before the change is effected, 18 March 2022. No idea of the weighting, sorry.

[Dassets]

Thanks mate, its good to have another bean counter on here to confirm my understanding. There could be some frank discussions between the auditors and management this year !


Usually most of the action in terms of index tracking funds happens in the 15 minute closing price match process the Friday before the change is effected, 18 March 2022. No idea of the weighting, sorry.

Just answered my own question. No trackers on ASX All ords. Rebalance 3rd Friday. Spark and Sky City out of ASX 200

[ados_nz]

Down 7.5% over the last week.... Incoming capital raise finally or just rebalancing selling pressures?

[Arbroath]

US airlines are being smashed 20-30% the past week so AIR down less as they aren't really using much jet fuel = cheaper to keep the planes on the ground than be flying!

I jest, or do I?

[Zaphod]

US airlines are being smashed 20-30% the past week so AIR down less as they aren't really using much jet fuel = cheaper to keep the planes on the ground than be flying!

I jest, or do I?

Given the very regular cancellations to domestic sectors of late, perhaps that's what they're doing? You might be on to something there!

[mikelee]

Yes, finally dropped below $1.40. Unbelievable that the SP was able to hang around mid $1.50 for so long. But with the high fuel prices and borders still largely closed, I would not touch it. Even AIA dropped below $7 for only the 2nd time in a long time.

[Beagle]

US airlines are being smashed 20-30% the past week so AIR down less as they aren't really using much jet fuel = cheaper to keep the planes on the ground than be flying!

I jest, or do I?

Jethole are known to do that A LOT. Lots of last minute cancellations if they don't get sufficient load to make it a profitable trip. They simply blame it on engineering or staffing issues. You cannot rely on them for any business flight...they really couldn't care less about their obligation to make all possible efforts to get people where they need to be. That's my perception of them. My perception could be wrong but I would never fly them again for a business trip. AIR could be headed down the same rabbit hole, who knows..., anyway what do I care, if I can't drive to where I want to go at present I'm not going, simple as that. Breathing in all that recirculated virus laden air...no thank you, not even if the flight was free or AIR paid me !

[Arbroath]

Yes, finally dropped below $1.40. Unbelievable that the SP was able to hang around mid $1.50 for so long. But with the high fuel prices and borders still largely closed, I would not touch it. Even AIA dropped below $7 for only the 2nd time in a long time.

Relax AIR back up to $1.45 because everything is going to be OK! anyway where has that fairytale book gone....Grant and the Giant Lemon...

[nztx]

https://www.stuff.co.nz/business/127991904/air-nz-senior-cabin-crew-to-strike-in-support-redundant-staff-rehired-on-lower-wages

Air NZ senior cabin crew to strike in support redundant staff re-hired on lower wages


Air New Zealand international cabin crew leaders have issued a strike notice in support of crew who are returning from redundancy on much lower pay.

E tū head of aviation Savage​ said experienced crew on the long-haul Boeing 787-9 and Boeing 777-300ER fleet who were made redundant because of the Covid-19 pandemic were being re-hired at a much lower wage.

Air New Zealand senior cabin crew earned an average salary of between $53,645 and $62,117.

But many leaders made redundant at the start of the pandemic were being hired back at the starting rate of $42,917, which over a 40-hour week worked out to be $20.60 an hour, he said.


Darn - just when .. more storm clouds appear ;)

[peat]

strongly down on larger than usual volume

13614

[mikelee]

Perhaps these senior crew should all take a 20% pay cut instead, to show their support to both their colleagues and the company in this difficult time. I suspect mostly it's about the principal than making enough to pay the bills. After all, with so much of their living expenses paid for, while on the road, I'm sure the crews can all come together to support the airline to ensure that they all have a job and continue to enjoy the life style they love so much. I reckon the recent high inflation would hit the airline's clerical staff hardest, as they're on fixed salary, with no overtime or allowances like the crew.

[SPC]

If you were paid redundancy then your old job disappeared. Coming back you a accept the terms of the new job you applied for and the pay it comes with. It isn't the old job.
Furloughed staff probably have a previous employment terms they can resume.
Given the airline is largely a Govt entity now I expect the union feels emboldened...

[nztx]

If you were paid redundancy then your old job disappeared. Coming back you a accept the terms of the new job you applied for and the pay it comes with. It isn't the old job.
Furloughed staff probably have a previous employment terms they can resume.
Given the airline is largely a Govt entity now I expect the union feels emboldened...

Probably on the money with that game plan ..

[causecelebre]

... I reckon the recent high inflation would hit the airline's clerical staff hardest, as they're on fixed salary, with no overtime or allowances like the crew.


Not to mention +/- 30% of the non operations staff package is bonuses which have been cancelled for the foreseeable future.

Not surprising the co. has to engage with consultants, eg. IBM, at 3x the rate of a locally employed worker: No one wants to work there! Kick in the guts for the loyal staff that have to work with them

[Zaphod]

Not surprising the co. has to engage with consultants, eg. IBM, at 3x the rate of a locally employed worker: No one wants to work there! Kick in the guts for the loyal staff that have to work with them

Given the ongoing uncertainty surrounding the demand for AirNZ's services, hiring contractors makes sense particularly for the IT function given the dearth of staff available to permanently fulfill such roles.

[winner69]

Seems cap raise by end of month

Existing shareholders - you all ready for the action

https://www.rnz.co.nz/news/business/463501/air-nz-looks-to-land-1-point-3b-in-capital

[Beagle]

Will someone please indulge me in a small wager that somewhere in the marketing propaganda, (opps sorry, capital raise documents), the words "revive" and "thrive" will be used more than once ;)

[Sideshow Bob]

Will someone please indulge me in a small wager that somewhere in the marketing propaganda, (opps sorry, capital raise documents), the words "revive" and "thrive" will be used more than once ;)

Polishing a turd comes to mind.

Qantas will be licking their lips......

[Beagle]

Polishing a turd comes to mind.

Qantas will be licking their lips......

Air Canada also quick off the mark to announce new services so there's no doubt the competition will coming flooding back.

[winner69]

Air Canada also quick off the mark to announce new services so there's no doubt the competition will coming flooding back.

That Rob Fyfe guy whose a Director of Air Canada knows what kiwis and Canadians want ….wasn’t he an AIRguy once

[Beagle]

That Rob Fyfe guy whose a Director of Air Canada knows what kiwis and Canadians want ….wasn’t he an AIRguy once

You know he was. You'd need to be pretty brave and have great endurance to get on one of those so called Dreamliner's with their sardine can sized seats and sit next to a bunch of strangers breathing in all their expelled breath as well as all the recycled air for 13 hours all the way to Vancouver. Whatever's in their lungs, is definitely in yours :eek2:

[nztx]

Any guesses on what AIR Ords are really worth now ahead of the coming "Fill in a Large Hole"
at any price exercise ? ;)

$1.43 currently definitely looks more than slightly out the door fresh AIR material than reality :)

[Balance]

Current market cap (sp $1.43) - $1.6 billion

Capital raise - say $1.3 billion.

Expect highly dilutive rights issue for capital raise - will have to be done at a deep discount to current sp for underwriters to be comfortable.

So 2:1 at 60 cents to raise $1.3 billion as a possibility?

[Dassets]

Thanks for the article. The increasing volume the past few days stands out like dogs *****. I will reiterate 1 cap raise(I assumed 1.5 bil last year) is not enough. 2 more likely needed. Here is its next issue. Today I brought business return AKL to BNE to see dear mum for the first time in 2 and a bit years. I paid cash of nzd$200. The rest was paid via using a credit from an earlier non operating flight. Hope the $200 is used wisely. Oh and only $1bil more of that noncash flykng to go. And yes that is after adjustimg for the airpoints

[Dassets]

More than just polish the turd, they are cutting it into a princess cut style turd.

[Baa_Baa]

But they're not going away, or bust, are they? That won't happen. It's just another 'once in two decades' opportunity to time a decent stake. Patience.

[Beagle]

But they're not going away, or bust, are they? That won't happen. It's just another 'once in two decades' opportunity to time a decent stake. Patience.

I'm up for a few hundred thousand if it gets down to 25 cents again.

[Arbroath]

Current market cap (sp $1.43) - $1.6 billion

Capital raise - say $1.3 billion.

Expect highly dilutive rights issue for capital raise - will have to be done at a deep discount to current sp for underwriters to be comfortable.

So 2:1 at 60 cents to raise $1.3 billion as a possibility?

This could be a bloodbath of a capital raise once reality hits. I remember Fletcher Forests doing a 2:1 at 25 cents and the share price went from about 70 cents all the way to the issue price because of the obscene number of new shares to be issued.

A 2:1 at 60 cents will raise the cash but the 2.3 billion of new shares should see the price head towards 60-70 cents as there would be 3.5 billion of shares in issue. Wow!

Probably then do a Sky and consolidate maybe 5:1 to get a $4 share price again to be respectable.

[Balance]

Remember Fletcher Forests well - ouch!!!!

The recent Sky rights issue (2.83:1 @12c) when the sp was 30c is the best recent example of a highly diluted rights issue. Sp went all the way down to 12.9c - painful for holders.

But there’s obviously an opportunity here - matter of seeing how low the sp goes.

Suspect that most of Air NZ would be held by retail investors these days so most of them are going to have the shock of their lives when they are ‘invited’ to put in more money into the airline.

[LaserEyeKiwi]

You know he was. You'd need to be pretty brave and have great endurance to get on one of those so called Dreamliner's with their sardine can sized seats and sit next to a bunch of strangers breathing in all their expelled breath as well as all the recycled air for 13 hours all the way to Vancouver. Whatever's in their lungs, is definitely in yours :eek2:

it’s amazing/scary how quickly humans have gone back to previous behavior despite CV being everywhere. In US, despite lack of foreign tourism, air travel passenger levels in 2021 was within striking distance of pre-pandemic volume (84%) and by Dec 2021 Hollidays it was actually above the prepandemic level.

I myself am surprised how my own sub-conscious changed now that Omicron has become widespread. A month ago I thought it would be many years before contemplating international holiday travel again, but now that Omicron is everywhere in NZ I see little difference in going to Queenstown vs going to Melbourne or Honolulu.

[bottomfeeder]

Any guesses on what AIR Ords are really worth now ahead of the coming "Fill in a Large Hole"
at any price exercise ? ;)

$1.43 currently definitely looks more than slightly out the door fresh AIR material than reality :)

Seen it time and time again. SP's always gets close to issue price after CR. Have to be priced at max as well as at a price that will entice an underwriter.

[BlackPeter]

Air Canada also quick off the mark to announce new services so there's no doubt the competition will coming flooding back.

... and they might get more custom than ever ... at the moment the route over the Americas to Europe looks so much more attractive than the alternative across Asia & Russia / Ukraine / Iran / ...

[Beagle]

it’s amazing/scary how quickly humans have gone back to previous behavior despite CV being everywhere. In US, despite lack of foreign tourism, air travel passenger levels in 2021 was within striking distance of pre-pandemic volume (84%) and by Dec 2021 Hollidays it was actually above the prepandemic level.

I myself am surprised how my own sub-conscious changed now that Omicron has become widespread. A month ago I thought it would be many years before contemplating international holiday travel again, but now that Omicron is everywhere in NZ I see little difference in going to Queenstown vs going to Melbourne or Honolulu.

You're obviously a young pup...I see them everywhere at bars and restaurants, jam packed in wearing no masks. That's one thing but sitting next to a whole bunch of strangers in a thin aluminum tube breathing their exhaled air, that's another thing. I won't be flying to Queenstown or anywhere else anytime soon.

Like other old hands above I also remember the Fletcher Forests thing but more importantly I remember the last time this crashed and burned when capital was raised at 25 cents a share. As many have already noted the share price inevitably gravitates to the rights issue price as shareholders are shocked with the extent of the capital raise. I can see the Sharsies crown, already reeling from a shocking start to the market in 2022 feeling like a Jumbo jet has run them over when they're asked to put their hands in their pockets for heaps more capital ands then watching the share price head down to a very similar level. Who is brave enough to underwrite this capital raise ?

[winner69]

You're obviously a young pup...I see them everywhere at bars and restaurants, jam packed in wearing no masks. That's one thing but sitting next to a whole bunch of strangers in a thin aluminum tube breathing their exhaled air, that's another thing. I won't be flying to Queenstown or anywhere else anytime soon.

Like other old hands above I also remember the Fletcher Forests thing but more importantly I remember the last time this crashed and burned when capital was raised at 25 cents a share. As many have already noted the share price inevitably gravitates to the rights issue price as shareholders are shocked with the extent of the capital raise. I can see the Sharsies crown, already reeling from a shocking start to the market in 2022 feeling like a Jumbo jet has run them over when they're asked to put their hands in their pockets for heaps more capital ands then watching the share price head down to a very similar level. Who is brave enough to underwrite this capital raise ?

and that last time i'm sure non government shareholders didn't get the chance to participate ....they just had to grin and bear it as the government loaded up their coffers and ended up with 80% plus of the company

So sharesies people (and others) might not have to find any spare cash

Of course that won't happen this time around will it

[Beagle]

and that last time i'm sure non government shareholders didn't get the chance to participate ....they just had to grin and bear it as the government loaded up their coffers and ended up with 80% plus of the company

So sharesies people (and others) might not have to find any spare cash

Of course that won't happen this time around will it

My memory has faded a bit but I do believe you're right and of course the same thing could easily happen again especially with this Govt's extreme socialist approach. Minority shareholders could easily be the sacrificial lamb.

[winner69]

My memory has faded a bit but I do believe you're right and of course the same thing could easily happen again especially with this Govt's extreme socialist approach. Minority shareholders could easily be the sacrificial lamb.

So if that happened those currently holding might see their $1.40 shares be worth only $0.30 or something (and no extra shares) …..and if AIR ever pays a divie again it will be pretty small with the zillions of new shares.

Doesn’t seem much sense holding at moment but then what do I know

[Beagle]

So if that happened those currently holding might see their $1.40 shares be worth only $0.30 or something (and no extra shares) …..and if AIR ever pays a divie again it will be pretty small with the zillions of new shares.

Doesn’t seem much sense holding at moment but then what do I know

Actually I think you've hit the nail directly on the head ! Any divvy will be many years away and even then probably only 5 cents a share and that's after yet another 1:5 share consolidation like last time. Rinse and repeat next time there's another crisis. Don't you absolutely adore socialism hand in hand with airline investment...what could possibly go wrong ;)

[Dassets]

The lack of comment from the company is telling.

Welcome to the Thunderdome!

"Two men enter. One man leaves."

I am one of those men. Disc Short

[Marilyn Munroe]

If you look at it through a political lens will the issue take place?

The haste with which the Government acted to reduce motor spirits duty suggests they are sensitive to economic damage suffered by voters following the recent adverse political poll.

Will Grant Robertson risk bringing down the hammer on mom and pop Robertson Airlines investors?

Boop boop de do
Marilyn

[BlackPeter]

If you look at it through a political lens will the issue take place?

The haste with which the Government acted to reduce motor spirits duty suggests they are sensitive to economic damage suffered by voters following the recent adverse political poll.

Will Grant Robertson risk bringing down the hammer on mom and pop Robertson Airlines investors?

Boop boop de do
Marilyn

No matter how desperate the government might be to please voters ... what would you propose they could do in the context of AIR's issues to achieve an outcome which satisfies both shareholders as well as the general public?

I only see a rock and a hard place ... and am only surprised that so many buyers willingly queue up to get there.

But hey - people are back to air tourism in the US as well as in Europe ... who knows, maybe things are not too different in NZ give it another handful of months ...

[dln]

Will Grant Robertson risk bringing down the hammer on mom and pop Robertson Airlines investors?
Of course.
They should have invested in real estate if they wanted govt protection ...

[Marilyn Munroe]

... what would you propose they could do in the context of AIR's issues to achieve an outcome which satisfies both shareholders as well as the general public?


Every time Robertson Airlines hits a sticky patch taxpayers have to open their wallets. An ordinary Kiwi Joker has to endure a sub standard education for his kids because the Koru Taniwhia got all the cash.

This should not be allowed to continue. Grant Robertson needs to grow a pair, be Dr Evil not Mini Me.

If Grant Robertson in Dr Evil mode asked me what he should do to protect taxpayers alone I would tell him this;

Do not subscribe to the share issue, that is just peeing money against the wall.

Write off the advances already made, what can't be paid won't be paid.

Let it go bust. If it survives fine but whatever happens he didn't throw another wad of taxpayers cash at it.

Offer the receiver slightly above break up value. If someone else comes over the top, fine it is their problem now.

If left holding the baby reconstitute as a different entity restricted to single isle aircraft. This will give the ability to cover domestic, across the ditch and the South Pacific but limit the scope of damage to taxpayers wallets next time things get sticky. If the new entity wants to operate larger twin isle aircraft the rules are it needs to be done by an arms length outfit whose losses are not a hazard to main entities balance sheet.

Boop boop de do
Marilyn

PS. If this post comes to the attention of the tea drinkers and biscuit nibblers in the Civil Aviation Authority Policy Division a chorus of offended pretense will arise.

[nztx]

Is there any chance of a multibagger lurking somewhere in the clouds & haze ? ;)

Politicians (the smarter versions) at the steering wheel of just about anything corporate
still generally ends in some form of grief somewhere (as for the less smarter versions .. well .. )

it might be worse than a wheel, wing or engine falling off .. ;)

Perhaps some revisions of the ACC cover might be needed to cover failure of
Robertson Air even while most of the birds are sitting on the tarmac :)

Perhaps ACC and/or the Large Super Funds should buy out AIR @ somewhere around $1.80
a share or north - based on the Hon Finance Minister's blind future faith in things looking
down into the bottom of the empty bucket being thrown around for frequent top ups..

Or even make it a buy out subsidiary of NZ Post - seeing as the NZ Post Camp like things
that require squillions of bucks thrown at them - as seen with Kiwibank :)

It could be a marriage made in heaven and save the Retail punters a bit of bother & pain down the track :)

[BlackPeter]

Every time Robertson Airlines hits a sticky patch taxpayers have to open their wallets. An ordinary Kiwi Joker has to endure a sub standard education for his kids because the Koru Taniwhia got all the cash.

This should not be allowed to continue. Grant Robertson needs to grow a pair, be Dr Evil not Mini Me.

If Grant Robertson in Dr Evil mode asked me what he should do to protect taxpayers alone I would tell him this;

Do not subscribe to the share issue, that is just peeing money against the wall.

Write off the advances already made, what can't be paid won't be paid.

Let it go bust. If it survives fine but whatever happens he didn't throw another wad of taxpayers cash at it.

Offer the receiver slightly above break up value. If someone else comes over the top, fine it is their problem now.

If left holding the baby reconstitute as a different entity restricted to single isle aircraft. This will give the ability to cover domestic, across the ditch and the South Pacific but limit the scope of damage to taxpayers wallets next time things get sticky. If the new entity wants to operate larger twin isle aircraft the rules are it needs to be done by an arms length outfit whose losses are not a hazard to main entities balance sheet.

Boop boop de do
Marilyn

PS. If this post comes to the attention of the tea drinkers and biscuit nibblers in the Civil Aviation Authority Policy Division a chorus of offended pretense will arise.

Interesting.

Not sure though, one isle planes are more economical to operate - but I guess it depends on the number of people you want to transport (and who want to be transported).

Just wondering, though. Do we know whether the taxpayer lost long term money with Air New Zealand?

While the taxpayer had to chip in money at times (and lots) ... they made as well huge profits at times with AIR, e.g. by selling half of what's now worth peanuts for a huge amount of money to clueless retail investors, and just by cashing in all the nice dividends over the last decade or so (well, minus the Covid years).

I didn't took the sums, but I am pretty sure that over the years the tax payer had worse things to carry than AIR ... and yes, now seems to be again one of these darker periods.

While I think that AIR will turn out for current retail shareholders a disaster ... I would not be surprised if whoever is minister of finance in say five to ten years from now can cream them again ...

[nztx]

Interesting.

Not sure though, one isle planes are more economical to operate - but I guess it depends on the number of people you want to transport (and who want to be transported).

Just wondering, though. Do we know whether the taxpayer lost long term money with Air New Zealand?

While the taxpayer had to chip in money at times (and lots) ... they made as well huge profits at times with AIR, e.g. by selling half of what's now worth peanuts for a huge amount of money to clueless retail investors, and just by cashing in all the nice dividends over the last decade or so (well, minus the Covid years).

I didn't took the sums, but I am pretty sure that over the years the tax payer had worse things to carry than AIR ... and yes, now seems to be again one of these darker periods.

While I think that AIR will turn out for current retail shareholders a disaster ... I would not be surprised if whoever is minister of finance in say five to ten years from now can cream them again ...


Govt probably made back any deficits incurred on AIR many times over by jacking up the values of
the Power Assets pre float .. we all know who wound up on the paying ends of that lot :)

[winner69]

Govt made heaps up to 2016.

Put in $1043 million and up to 2016 got $1234 million cash back up to 2016 and still had shares worth $1341 million

Pretty good eh

I might quickly look at what’s happened since …it’s been about $572m in divies and current holding worth about $830m ……so last few years only slightly ahead (divies 572m v cap loss 511m)

https://www.treasury.govt.nz/publications/research-and-commentary/rangitaki-blog/crowns-investment-air-new-zealand-part-1-3

[Dassets]

SORRY CHART DOESN"T POST EDIT
Here is the chart prior to the bailout out in 2002. Feb 01 2000 share price at $9.42. It fell for 2 years til finally in October 2001 a rescue package was announced giving the government 82% at 24 cents, the cash available early 2002. A further cash injection was required in 2004 at 27 cents. In 2013 the Crown sold $365m and its stake dropped to 53%. So the lessons are 1. The government can wipe out minorities with the 2001 bailout at 3% of the price less than 2 years before. 2. It can then use "investors" later, and 3. It can own much more than 52%(its current position). Now while this is not the same government than the other 2, this govt's ideal's are clear. And shareholders are not as important as voters.

One last thing, I understand that the take-up by Sharesies clients of recent cash issues and placements has dropped off a proverbial cliff. So unless this cash issue is priced at a level that institutions believe there is an investment case then the cash issue will not fly or the government, as an assumed underwriter, will own all but the lot.

When the government find there is no support the price will be cut to the bone and they will own it. Some of the recent broker research is fascinating. One well known broker says AIR will have to raise $1.3B. The derived numbers show a cash issue of 1.3 B shares at an issue price of $1. So about 1.2 new shares for 1 old share, or an entry price at CMP of $1.42+$1.20 = $2.62 /2.2 shares means avg entry price of $1.19 per share. At that issue that broker says NTA is circa $0.50-60 (not going to use precise so the broker is not identified). Goodwill of 60 to 70 cents per share on 2.4B shares or $1.45 to $1.7B. AIR only ever achieved that level of goodwill very briefly over the past 15 years(won't bother with before) when it was paying big dividends and flying in clear blue skies.

Then that broker says it will need to borrow ALOT(keeping the number out) in FY23. Cashflow from operations and after capex is negative. Just wow. Who is going to lend to them and at what rate??

As I say this first cap raise will be followed by 2 raising a similar amount. The first cash issue at 50 cents, non renounceable but you never know. That means

[Beagle]

Good post Dassets. I forgot about the subsequent cash injection in 2004, two years later.
I think they're on the same flight path here. The first cash issue will solve their immediate needs and a second one will be required to restore operational solvency 2 years hence if not earlier. Maybe a third as well. You're dead right about this Govt's ideologies so the potential to treat existing minorities with complete contempt should be readily apparent to all, especially with the benefit of looking at the previous history of how this was handled 20 years ago.
Buying the shares now is analogous to taking a hospital pass on the Rugby field...you're going to get absolutely smashed.

[Waltzing]

think we have clearly seen that this GOVT doesnt know what financial accounting actually is.

and as MR B has been saying for while its flying on fumes and some hot air currents.

one wondered when the SHAZ would come to understand what a sharp spin operation SHAZ HQ is..

what till this stock drops it hat onto the market and the SHAZ get taken out to the wood shed....

GUY's fav saying ...

[winner69]

A few days before the 2001 bailout AIR boss proudly announced 'no worries, we have a billion dollars in cash'

Does AIR have a billion dollars cash on hand at the moment

[Beagle]

A few days before the 2001 bailout AIR boss proudly announced 'no worries, we have a billion dollars in cash'

Does AIR have a billion dollars cash on hand at the moment

LOL I remember that like it was yesterday. They have been touting their so called liquidity lately...which is really just the amount of the Governments bailout loan that's left and of course that does not account for the other liability which is ticket sales in advance. I think we all know the airline is properly insolvent so there is unlikely to be any talk about a billion in cash this time but you can set your watch by the fact that in several places throughout the capital raise documentation the words revive and thrive will be used....probably many times in an attempt to put lipstick on this pig.

[Arbroath]

LOL I remember that like it was yesterday. They have been touting their so called liquidity lately...which is really just the amount of the Governments bailout loan that's left and of course that does not account for the other liability which is ticket sales in advance. I think we all know the airline is properly insolvent so there is unlikely to be any talk about a billion in cash this time but you can set your watch by the fact that in several places throughout the capital raise documentation the words revive and thrive will be used....probably many times in an attempt to put lipstick on this pig.

I just can’t rationalise this one. Having gone large on several deeply discounted and highly dilutive rights issues I think this one is probably worth letting go outside off stump. It’s probably 4 wides in the making.

[Beagle]

I just can’t rationalise this one. Having gone large on several deeply discounted and highly dilutive rights issues I think this one is probably worth letting go outside off stump. It’s probably 4 wides in the making. plus 4 overthrows when the ball is thrown back to the keeper and mishandled again.

[BlackPeter]

LOL I remember that like it was yesterday. They have been touting their so called liquidity lately...which is really just the amount of the Governments bailout loan that's left and of course that does not account for the other liability which is ticket sales in advance. I think we all know the airline is properly insolvent so there is unlikely to be any talk about a billion in cash this time but you can set your watch by the fact that in several places throughout the capital raise documentation the words revive and thrive will be used....probably many times in an attempt to put lipstick on this pig.

Maybe they should rebrand it at the same time to "Air Phoenix" ... I understand the process of revival used to work for this magic bird ... at least that's what the fairy tales are saying ...

[Dassets]

Maybe they should rebrand it at the same time to "Air Phoenix" ... I understand the process of revival used to work for this magic bird ... at least that's what the fairy tales are saying ...

I found the recipe in my trusty "Harry Potter and Robo's Enterprises' Kitchen of Magic" omnibus(given to me when I left the West Coast(Central) Socialist Curling Club).

To Rescue An Airline
Add
1 x Poultice of self Folding Cash(add 2 to 3 times poultice for severe cases)(if not enough on hand request more from the printer)
Pay rises to Pilots(no need for other in flight personnel) as required
Chant the Phrases " Light at the End of the Tunnel", "Revive", " Thrive" and "Growth" at least 53 x each.

Note for this recipe to work you must gather as much cash as possible from muggles offering flight to such muggles without giving them flight(in itself another magical spell may be required).

[Waltzing]

should it even be trading at this point....should come with a health warning.

But in classic Winner(*n) speak, the Finance wizard said better days are coming!

Its all good then... up up and .....

over 600,000 today passed over the counter.

[Sideshow Bob]

Sharsies customers likely up for $60m as their part of the capital raise…..:scared:

https://businessdesk.co.nz/article/markets/air-nzs-sharesies-shareholders-on-the-hook-for-60m (paywalled)

[JohnnyTheHorse]

Sharsies customers likely up for $60m as their part of the capital raise…..:scared:

https://businessdesk.co.nz/article/markets/air-nzs-sharesies-shareholders-on-the-hook-for-60m (paywalled)

I suspect many won't have the free money to participate, especially those who have invested larger amounts. They are going to get hammered.

I will be a buyer though... to cover my short :eek2:

Big money clearly starting to dump positions.

[Sideshow Bob]

Part of the revive/thrive/survive......??

Air New Zealand reveals new launch date for non-stop New York flights | Stuff.co.nz (https://www.stuff.co.nz/travel/news/128133671/air-new-zealand-reveals-new-launch-date-for-nonstop-new-york-flights)

[Waltzing]

the team at SHAZ continuing to offer weekly prizes.

maybe then the AIR cap raise come they will double the prizes that week!!

its not a share broker, its a supermarket selling slices of an investment company.

Its an investment company in any other name....

It milking its sheep, its shaz base, its almost third hand car sales man ship.

[Sideshow Bob]

I suspect many won't have the free money to participate, especially those who have invested larger amounts. They are going to get hammered.

I will be a buyer though... to cover my short :eek2:

Big money clearly starting to dump positions.

Almost 52,000 shareholders, and excluding the Govt, means the average holding is 10,400 - and that is counting all the Sharsies as one holder.

Agree, hammer time is coming. Not like they didn't know it was going to happen.......

[Beagle]

Part of the revive/thrive/survive......??

Air New Zealand reveals new launch date for non-stop New York flights | Stuff.co.nz (https://www.stuff.co.nz/travel/news/128133671/air-new-zealand-reveals-new-launch-date-for-nonstop-new-york-flights)

Yes you can bet your last dollar they will try and "sell the sizzle" with all sorts of references to "revive and thrive"...probably the investment banking teams are going through this online thesaurus as we speak working out how many different ways they can say the same thing www.thesaurus.com without being too obvious about it. Any forecast will contain more fine print caveats than the Russell McVeagh library has law books explaining the term.

[Waltzing]

its about to become a plane wreck....

millions of shares on order ... are they all covering shorts or just unaware?

[Beagle]

its about to become a plane wreck....

millions of shares on order ... are they all covering shorts or just unaware?

Its going to redefine the term "hard landing" They'll be studying how this fiasco played out for decades to come in investment analysis classes at University.

[Marilyn Munroe]

Part of the revive/thrive/survive......??

Air New Zealand reveals new launch date for non-stop New York flights | Stuff.co.nz (https://www.stuff.co.nz/travel/news/128133671/air-new-zealand-reveals-new-launch-date-for-nonstop-new-york-flights)

Call me a cynical old movie star bit I reckon this is as much a good news story leading in to the issue as it is a route chosen to meet demand.

Boop boop de do
Marilyn

[Beagle]

Call me a cynical old movie star bit I reckon this is as much a good news story leading in to the issue as it is a route chosen to meet demand.

Boop boop de do
Marilyn

That hits the nail directly on the head !

[nztx]

its about to become a plane wreck....

millions of shares on order ... are they all covering shorts or just unaware?


News reports suggest that China Air just had one -- not much surviving evidence afterwards ..

[winner69]

Jeez Foran was like an excited kid on the TV news just now

Super excited about NY and how bright the future looks ..... think that is what he said ....but he was beaming

[Beagle]

Jeez Foran was like an excited kid on the TV news just now

Super excited about NY and how bright the future looks ..... think that is what he said ....but he was beaming

Must admit he's done a fabulous job in the last 2 years of trying to keep this sick bird flying but no amount of handsome smiles and talk of revive and thrive can disguise the fact this bird is looking very, very sick and in need of extended life support.

[mikelee]

I'd not be surprised if Ed Sim is named the next CEO if Greg choose to retire after this mess is all over.

[777]

I'd not be surprised if Ed Sim is named the next CEO if Greg choose to retire after this mess is all over.

I would be.

[Baa_Baa]

Has there ever been a more widely announced shareholder capital cremation? Perhaps we've missed the point, like maybe the government just loans them another Bill or so at some extortionate % with another Bill if required. Debt/interest repayments replace dividends, to govt. Airline recovers eventually. Shareholders not too badly capital screwed, but don't expect dividends for a long time.

[Waltzing]

" shareholder capital cremation?"

brilliant !

yes loans would actually be the way to go; sell some bonds to the reserve bank...

[Sideshow Bob]

I'd not be surprised if Ed Sim is named the next CEO if Greg choose to retire after this mess is all over.

I feel sorry for Greg. What was it - in charge for 2 days before Covid hit? Seems like a good bloke, was well regarded at Walmart, but got hit by the proverbial (air)bus. Always in hindsight might have done things differently, but unprecedented situation.

Hope he sticks around for a while, and would be interested to see how he goes "situation normal-ish".

[Beagle]

Yeah, I think he was doing the informal rounds, meet and greet of senior staff a few days before it hit and he formally took up his role.
Talk about getting a "hospital pass' but I agree that top his credit he's carried the ball well as anyone could have been expected too in these extraordinary times.

I also loved Baa Baa's "capital cremation" comment, absolute classic.

[iceman]

Part of the revive/thrive/survive......??

Air New Zealand reveals new launch date for non-stop New York flights | Stuff.co.nz (https://www.stuff.co.nz/travel/news/128133671/air-new-zealand-reveals-new-launch-date-for-nonstop-new-york-flights)

Incredibly, despite all the media fanfare and feel good stories, one can not book a Premium Economy nor a Business Class fare on this route, from their website. A pretty pathetic start !!

[777]

Incredibly, despite all the media fanfare and feel good stories, one can not book a Premium Economy nor a Business Class fare on this route, from their website. A pretty pathetic start !!

Yes you can. Booking page defaults to economy. All you have to do is make an alternate selection for other classes.

[iceman]

Yes you can. Booking page defaults to economy. All you have to do is make an alternate selection for other classes.

Nope not on my one. Takes me to the USA site and says for PE & BC "this service is not available on this flight". Same when I try to do it from the app. Not sure if the fact I'm outside of NZ is making a difference or some hickup ?
Not seen this before.

[iceman]

13634

Screenshot from the app

[777]

The fact it states "Not available" may mean they are fully booked. I get the same on that date but one week later there are seats.


If that is the first flight out it is probably loaded with free loaders.

[Beagle]

https://www.nzherald.co.nz/business/800-staff-return-to-air-new-zealand-as-travel-takes-off-again/UQ4VSAWPFBISDRBKQV533XT2UI/

[iceman]

The fact it states "Not available" may mean they are fully booked. I get the same on that date but one week later there are seats.


If that is the first flight out it is probably loaded with free loaders.

That explains it. They will have had their capital raise then, flush with money and no need to sell tickets, just freeloaders. Great for SH bbut glad I'm not one of them.
My business for that planned travel will go elsewhere

[Sideshow Bob]

https://www.nzherald.co.nz/business/800-staff-return-to-air-new-zealand-as-travel-takes-off-again/UQ4VSAWPFBISDRBKQV533XT2UI/

Travel "takes off"

Putting lipstick on a pig to get the punters money for the capital raise.....

[Maxtrade]

Likely in April, Billion dollar plus, will be interesting to see how much blind faith can have to holding up the SP when the Cap Raise price is released. Likely to see a massive share dilution resulting in SP testing previous lows. An ,abundance more shares surely even those faithful believers can understand its written on the wall what the cap raise will do to the SP. Amazed haven't seen a sell off already, but understandably until it is announced and in the public media limelight where the general public are reading about it will we then see the card stack start to tumble. Nerves of steel to holders trying to ride it out though.

[Patrick11]

A long flight to new York is not for me, I would need a stop over in LA but there must be a demand

[Beagle]

A long flight to new York is not for me, I would need a stop over in LA but there must be a demand
Maybe there is demand or maybe a big part of the reason is its also part of a carefully curated charm offensive deigned to confer the impression that AIR is really "taking off" and deserves support for its pending capital raise.

[Waltzing]

they need a new add series !!

Susie Q Paul!!

or another over 50 year old make over gal super model babe!!!

Rachel Huntress!!!

at what point is the marketing to the SHAZ from SHAZ HQ need some guidance from the FMA.

"Come and Get Some"

2 million odd short covering ...

"Come and Get Some"

[Maxtrade]

they need a new add series !!

Susie Q Paul!!

or another over 50 year old make over gal super model babe!!!

Rachel Huntress!!!

at what point is the marketing to the SHAZ from SHAZ HQ need some guidance from the FMA.

"Come and Get Some"

2 million odd short covering ...

"Come and Get Some"

Yeah will likely see some serious shorting start to play out, ahead of cap raise price being released, going to be a bit of a bloodbath ahead. Makes little sense the volumes resting on the buy side currently. Blind faith, or simply excited coming out of lockdowns and boarders opening, yet oblivious to the enormous debt the cap raise will simply be paying back. Dilutiing shareholders ownership and value of their existing shares?? Surely most investors can see that?

[winner69]

We're connecting to the world says Greg ..... connectivity is an important part of the Kia Mau Thrive strategy

[Waltzing]

is that "Thrive: or "DIVE!!!!!"

the buy side cant be all shorts right?

who's SHORT!!!!

this almost needs a Tax Payer funded film from the NZ FILM Commission...

the same executives at FILM NZ that ran away from the Tax Payer interview over MILKED!!

WHO's GETTING MILKED HERE!!!!

cant wait to read the preso from SHAZ HQ!!!!

Book your seats now for the ride of your life!!!!

Its just like a when you AVERAGE DOWN Folks!!!

Step right up and we will double the Gift prize this week if you take up this offer from your host and hostess at AIR NZ!!!

Complete with Photo of a beagle in a biplane with goggles!!!

here he is folk's your friendly local stock market advise complete with goggles!!!

https://www.youtube.com/watch?v=WOjZAN5bo2g

handsome looking beagle and very very popular!!!

[stoploss]

https://www.stuff.co.nz/business/money/300549219/your-money-questions-answered-whats-happening-with-my-air-nz-shares

[Arbroath]

https://www.stuff.co.nz/business/money/300549219/your-money-questions-answered-whats-happening-with-my-air-nz-shares

I feel like an excited teenager waiting for the movie to start...I'm sure if it will be a comedy or a horror, or both, but it won't have a happy ending at least until about 2024.

[winner69]

I feel like an excited teenager waiting for the movie to start...I'm sure if it will be a comedy or a horror, or both, but it won't have a happy ending at least until about 2024.

Business Desk had a piece from an expert guy who said maybe too risky just now and cap raise might be delayed until May/June

Suppose that means it'll be tomorrow

[JohnnyTheHorse]

Business Desk had a piece from an expert guy who said maybe too risky just now and cap raise might be delayed until May/June

Suppose that means it'll be tomorrow

Friday or Monday would be my bet. New financial year to keep things tidy. They would be mad to delay it further in case the market turns again.

[Balance]

Friday or Monday would be my bet. New financial year to keep things tidy. They would be mad to delay it further in case the market turns again.

It’s really up to the underwriters and the government when the CR takes place - not Air NZ.

[CD_CHCH]

Friday or Monday would be my bet. New financial year to keep things tidy. They would be mad to delay it further in case the market turns again.
Surely no one in their right mind would release details of the capital raise on 1st April...

[unhuman]

I wish they would just get it over and done with.

Two years of waiting.

[JohnnyTheHorse]

Halted pending announcement on recapitalisation plans.

[winner69]

Ann 6.30 tonight


Prob on TV1 news to promote it;)

[Beagle]

No doubt a song and dance will be made about them opening up to revive and thrive but here's a quick look at all the competition that have so far announced they are coming back or are already back here and flying https://www.stuff.co.nz/travel/news/300551781/all-the-international-airlines-and-routes-that-are-coming-back-to-new-zealand

JTH, you stand to make a killing on your short position. Congrats and well done.

[Gerald]

I would assume anyone short would be forced to take up their rights, and hence would only profit if the price falls bellow the weighted average of the short price and price the new shares are issued at?

[JohnnyTheHorse]

No doubt a song and dance will be made about them opening up to revive and thrive but here's a quick look at all the competition that have so far announced they are coming back or are already back here and flying https://www.stuff.co.nz/travel/news/300551781/all-the-international-airlines-and-routes-that-are-coming-back-to-new-zealand

JTH, you stand to make a killing on your short position. Congrats and well done.

Only a small short on this. I struggle to see how it could go wrong, however I don't like to make big plays on very obvious things as surely the market has positioned themselves for it. Some funds were clearly selling down the last few weeks, but who the hell was buying??? Seemed really odd.


I would assume anyone short would be forced to take up their rights, and hence would only profit if the price falls bellow the weighted average of the short price and price the new shares are issued at?

Correct. But with such a large issue there is likely to be many holders picking up rights that weren't taken up, so would expect the price to fall below the new 'weighted' price.

[Beagle]

A LOT of lipstick needed for this pig. Here we go...
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/AIR/389769/367765.pdf

2:1 issue at 53 cents. Don't say you weren't warned folks, such a drastically discounted issue has been talked about on here for many months.

Everything is going to come up roses by FY25, so they say and be 90% of what they were doing before Covid Hit.
My comment, that's amazing clarity from their crystal ball.

Losses for current year now forecast to be less than $800m
My comment, there's a reasonable chance that will be fairly accurate as they have ~ 9 months of FY22 trading under their belt and a good indication of forward bookings for the next few months but they will have no idea now of the trading conditions in FY25 and neither will anyone else.

Rights can be sold, trading starts 6 April finishes 26 April
Theoretical ex rights price is $0.81, shares trade ex rights 6 April

Get in early if you want to sell your rights. In my experience with nearly every rights issue I have seen as you get closer to the final date of trading the rights lose value and the share price converges upon the new issue price, in this case 53 cents.

[winner69]

2 for 1 at 53 cents

[Balance]

Current market cap (sp $1.43) - $1.6 billion

Capital raise - say $1.3 billion.

Expect highly dilutive rights issue for capital raise - will have to be done at a deep discount to current sp for underwriters to be comfortable.

So 2:1 at 60 cents to raise $1.3 billion as a possibility?

My prediction 2 weeks ago vs reality today of 2:1 at 53 cents.

Not that far off.

[ados_nz]

2 for 1 at $53c gives an average weighted sp of $1.09 based on today's close?

[winner69]

Slide 35 calcs I did in my head

But suppose many shareholders will need a simple explanation of TERP

I got 81 cents as well ....but I didn't calculate the 53 cents is a 35% discount to TERP

[winner69]

2 for 1 at $53c gives an average weighted sp of $1.09 based on today's close?

TERP is 81 cents

[ados_nz]

Thanks Winner, New to this so trying to figure out the value level to close the short.

[Beagle]

My prediction 2 weeks ago vs reality today of 2:1 at 53 cents.

Not that far off.

You're a legend.

[winner69]

No doubt rights trading could be interesting for some next week

[stoploss]

I would assume anyone short would be forced to take up their rights, and hence would only profit if the price falls bellow the weighted average of the short price and price the new shares are issued at?
If you are short something you don't own it so you are not going to get the rights to take up the shares.
Just as if you are short , you don't get the dividend if it pays one -the owner of the shares gets that.

[Balance]

No doubt rights trading could be interesting for some next week

If FFS & SKT are any guide, going to be a bloodbath for retail investors.

[Gerald]

No dividends till 2026 :scared: Oh dear

[Balance]

No dividends till 2026 :scared: Oh dear

4 years is a long time in the airline industry!

So WTF is going to buy the shares?

[stoploss]

2 for 1 at $53c gives an average weighted sp of $1.09 based on today's close?
Lets say they closed at $ 1.38
Assume your shareholding is 10,000 so $ 13,800 value of investment .
Entitlement to 20,000 shares @ .53 $ 10,600
So you have 30,000 shares for $ 24,400 invested , Ave price would be $ .8133

[Beagle]

4 years is a long time in the airline industry!

So WTF is going to buy the shares?

No one in their right mind lol

Key Risks - 7 pages of them in the presentation materials and they specially numbered the pages to help avoid any confusion as to the extent of them :scared:

Anyone spotted who's underwriting this capital raise ?

[winner69]

Presentation says -

Shareholders who do not acquire any New Shares in the Rights Offer (or the shortfall bookbuild) will be diluted by 67%


Suppose at the end of the day dilution doesn't mean very much at the end of the day for many shareholders

[Baa_Baa]

My prediction 2 weeks ago vs reality today of 2:1 at 53 cents.

Not that far off.

Brilliant call, well done. Terrible outcome for shareholders, especially the noobs, savaged their capital, being diluted to hell or having to stump up more capital for an extremely uncertain future, especially short term next 2-3 years.

We'll be watching for the SP fall back to the rights issue price and whether it overshoots down from there, before taking a long position. Would prefer a SP in the .20 - .30 entry than risking a .50 position. Might happen.

[JohnnyTheHorse]

If you are short something you don't own it so you are not going to get the rights to take up the shares.
Just as if you are short , you don't get the dividend if it pays one -the owner of the shares gets that.

The person you borrowed the shares off is entitled to rights or dividend. So you must pay them the dividend amount or return extra shares they are entitled to in the rights issue.

[Beagle]

Executive summary, bottom of page 7 Extract - Investors are strongly cautioned to not place undue reliance on these targeted financial objectives, particularly in light of the ever-changing Covid-19 situation, the current economic climate and the significant volatility, uncertainty and disruption caused by the pandemic, as well as the current conflict in Ukraine and its impact on global fuel prices. Due to the uncertainties going forward created by these factors, these targeted financial objectives should only be regarded as indicative of one possible outcome

Huge caveat for all to see in the presentation. In other words their targeted financial objectives are their best case scenario of many possible scenario's some of which are abhorrently worse and may involve another capital raise in due course of a similar magnitude. Talk about extreme risk !!

Once the dust settles from all this it could be worth a small high risk punt at 25-30 cents.

[Rawz]

Brilliant call, well done. Terrible outcome for shareholders, especially the noobs, savaged their capital, being diluted to hell or having to stump up more capital for an extremely uncertain future, especially short term next 2-3 years.

We'll be watching for the SP fall back to the rights issue price and whether it overshoots down from there, before taking a long position. Would prefer a SP in the .20 - .30 entry than risking a .50 position. Might happen.

The noobs, aka us tax payers and then followed by the sharesies army. Sad!

Who knows, maybe the sharesies troops keep the SP up, they have done an amazing job of it so far

[winner69]

So my $1.40 shares aren’t really worth that any more? ….asking for a friend

[pierre]

Anyone spotted who's underwriting this capital raise ?

If its in the presentation its very well hidden. I've scanned through the document but can't see a name anywhere. That doesn't mean there isn't a name though - my eyesight is not that great when it comes to small print.

Is there a possibility it might be G. Robertson though?

[Nurg]

Anyone spotted who's underwriting this capital raise ?

Citigroup Global Markets and UBS New Zealand

[Beagle]

If its in the presentation its very well hidden. I've scanned through the document but can't see a name anywhere. That doesn't mean there isn't a name though - my eyesight is not that great when it comes to small print.

Is there a possibility it might be G. Robertson though?

Found it. Page 32 of the offer document http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/AIR/389769/367770.pdf
Underwriters
Each of Citigroup Global Markets Limited and UBS
New Zealand Limited.

Notice how Forsyth Barr are not participating in the underwriting agreement despite being a lead manager. Maybe they don't believe their own guesswork that went into the forward looking statements lol

I'd love to see the full terms of the underwriting agreement. Bet there's more conditions in there than I've had hot dinners so far this year including the infamous force majeure catch all clause to cover off risks like a global market meltdown as a result of say for example Nuclear war.

[winner69]

The announcement included a profit upgrade

Loss now expected to be less than 800n …previously it was exceeding 800m

That’s good

[Beagle]

I really love your dry humour mate. "Profit upgrade" is definitely an oxymoron in the context of what's happening here lol.

[ados_nz]

My 2 for 1 calcs were backwards! It's worse (better ;)) than I thought...

[Marilyn Munroe]

I wonder if the coven of Sharetrader witches huddled around a boiling cauldron as in the Scottish Play chanting "Hubble bubble toil and trouble, Robertson Airlines will cost the shareholders double", caused the issue to go early before the chanting became an wider meme?

Boop boop de do
Marilyn

[Dassets]

Beagle, absolutely agree. I have been in and out of this for circa 30 years. At one point a fund I was investment manager for was one of the larger insti holders. IMO AIR's go forward business model is unknown. They will need a freight component but how is an issue.The govt can't keep propping up it up when the a/c are not freight aircraft but mixed revenue. There is no chance of conversion or new buys or old. So dilemma because if NZ loses or seriously degrades that freight capability then NZ exporters are in Big Trouble in Little China territory. Long haul, imo, is effectively gone to any meaningful level. Short haul has lesser but no means insignificant challenges but hard to see it anywhere near 2019 levels for at least another 5 years.

The directors(and auditors) have to sign the accounts of soon as a going concern I presume. Problem is there is no business clarity at all. It is losing money even with subsidies. At some point the WTO may be pressured over the subsidies because long term they are illegal.I wonder how far AIR/GONZ can push it.

At $1.00 there will be a big shortfall and Govt underwrite will be called. At 50 was where I pitched it 12 months ago but maybe 75 is right given the Labour Govt approach to life. They would like to buy all of it actually but with the lack of money bailing out AIR or paying nurses is a no brainer.

Post from June last year musing whether my earlier call of 12 months earlier of 50 cents was ambitious. Well maybe by 3 cents it turns out. But the reality is the mugs that take up the privilege offered to them in the rights will be diluted further. The new NTA will be 40 cents after the June 22 year losses and with the new stock. Then you have further losses next year. The prefs will then further dilute. The Shaz will be wondering what happened to their $1.70 shares. I guess half won't take up their rights. Good luck to the underwriters. They will need it. Hope they can keep the share price above 50.

[Waltzing]

"The airline said today that it is on target for a full-year pre-tax loss of less than $800m, a brighter outlook than the excess of $800m it forecast last month."

but how much less ?

it will be interesting to see how much pig lip stick get throw out there by SHAZ HQ....

first they have to explain what this actually is and put a GIFT prize on it...

Maybe some free international flights!!! Singapore?

[Beagle]

Post from June last year musing whether my earlier call of 12 months earlier of 50 cents was ambitious. Well maybe by 3 cents it turns out. But the reality is the mugs that take up the privilege offered to them in the rights will be diluted further. The new NTA will be 40 cents after the June 22 year losses and with the new stock. Then you have further losses next year. The prefs will then further dilute. The Shaz will be wondering what happened to their $1.70 shares. I guess half won't take up their rights. Good luck to the underwriters. They will need it. Hope they can keep the share price above 50.

I was in the 25 - 40 cent camp and maintain that's all they're worth at present including their landing rights, goodwill and IP but the size of the potential losses in FY23 and FY24 must surely give any serious investor grave cause for concern. Maybe they can thread the needle to better times when they eventually start making a profit with just this capital raise program but I certainly wouldn't bet on it. Another capital raise in about 2 years is my pick.

Uninvestable best describes this company in my opinion.

[hyinvest]

My prediction 2 weeks ago vs reality today of 2:1 at 53 cents.

Not that far off.

Are you Greg Foran 😉?

[Beagle]

Balance has finally be outed lol

[peat]

Still short from $1.50 area but not as many as I was once…

finally some dvlpmnts!!
looking forward to tomorrows open
will take some profit at 1.00

[Dassets]

Beagle, good post, that I agree with you 100%. The NTA at year end with the new shares and after losses probably circa 33 cents a share. I have been saying 2 raises after this but the deck chairs have been re-arranged. Wait for the operational cashflows to look strange, unless the company intends to spend all forward ticketing sales as they receive them. If they do that it will go bust again. Decision now is do I hold my s...t position:D longer. Some of it is from Jan last year.

[see weed]

Balance has finally be outed lol
Gee, doesn't seem that long ago we were talking about the special 25c div from Virg sale plus the normal div of 10c and I had accumulated about 120,000 shares to get this massive payout, which I was against, because the sp dumped for a while after that. Then a while later we cornered Chris Luxton at a meeting to ask him if the RR engines were going to drop off the planes. :confused: I think he thought we were joking and had a bit of a laugh. Ahh the good old days will come back one day, give it a bit of time;).

[nztx]

Twice 53c for a wounded bird flying in shrapnel filled Covid skies into unknown storm clouds sounds a bit on
the expensive side to me without any Govt guarantee on performance or a put option in place for a parachute exit unscathed ;)

I note that the purpose of the Raise clearly states to pay (among other things) back Robertson's large loan, so on that alone, I think I'll steer well away in the safer clouds further above, and watch how this miracle rehatching of something in a deep dive near on terminal stall goes .. from a very safe distance ;)


but don't let me discourage others from jumping in clad in suitable crash landing flameproof attire
to try their luck :)

[Beagle]

Beagle, good post, that I agree with you 100%. The NTA at year end with the new shares and after losses probably circa 33 cents a share. I have been saying 2 raises after this but the deck chairs have been re-arranged. Wait for the operational cashflows to look strange, unless the company intends to spend all forward ticketing sales as they receive them. If they do that it will go bust again. Decision now is do I hold my s...t position:D longer. Some of it is from Jan last year. Thanks mate, I think you know what to do. Unless you feel guilty from profiting from this slow motion train wreck you might as well ride it longer and jump off just before final impact.


Gee, doesn't seem that long ago we were talking about the special 25c div from Virg sale plus the normal div of 10c and I had accumulated about 120,000 shares to get this massive payout, which I was against, because the sp dumped for a while after that. Then a while later we cornered Chris Luxton at a meeting to ask him if the RR engines were going to drop off the planes. :confused: I think he thought we were joking and had a bit of a laugh. Ahh the good old days will come back one day, give it a bit of time;). Ahhh, yes the good old days mate, I remember them well. I've always loved aviation but I have learned to be a disciplined investor and learned there's no room for emotion with investing. AIR faces a very, very long and very difficult path back to prosperity and very serious headwinds, challenges and uncertainties remain. Anyone jumping on board definitely needs to make sure they're not faint of heart, short of capital or likely to need to be selling anytime soon...and oh yes, please fasten your seat belt very firmly !! They're fueling up the plane for this next leg of their journey but the prospects of the tank being empty before they get where they're trying to go look very real to me.

I don't mix philanthropy and investing and the prospect of putting funds into this feels very much like the former.;)

[Dassets]

Prediction (Not A Forecast) using the same Level 4 Ballistic Vest protection as the AIR disclaimer which incidentally I don't think I have seen before. AIR will make some SRT(Survive etc) announcements on how well 'growth' is going. "Pax enjoying int travel again with the Akl Syd up 350% yoy". Losses shrinking etc. 2 years down the track they will start blaming continuing losses on consumer carbon consciousness, persistent high fuel prices, reduced corporate demand due to zoom and overhang of legacy credit issuance from the Pandemic Era.

[bull....]

anyone buying today to be elligle for the rights issue ?

[JohnnyTheHorse]

anyone buying today to be elligle for the rights issue ?

Record date is 7pm 5th April, so T+2 means you wouldn't be eligible if purchasing today?

Edit: here I am thinking it's Friday already... You are right.

[ordop]

cum rights trading today and tomorrow - Thursday and Friday. Ex rights trading Monday onwards.

[LaserEyeKiwi]

So 3.1 billion shares on issue following rights offer.

Company said it’s Ballpark hopeful of achieving $275 million NPAT in 2025.

Not a chance this company is worth $1 a share.

The rights price of 53c is probably a tad high as an estimate of where the stock price ceiling should be trading post right issue, given the risks involved, implying a market cap of ~$1.6 Billion.

Likely the retail crowd will keep the price inflated well above fair value though.

[Beagle]

Prediction (Not A Forecast) using the same Level 4 Ballistic Vest protection as the AIR disclaimer which incidentally I don't think I have seen before. AIR will make some SRT(Survive etc) announcements on how well 'growth' is going. "Pax enjoying int travel again with the Akl Syd up 350% yoy". Losses shrinking etc. 2 years down the track they will start blaming continuing losses on consumer carbon consciousness, persistent high fuel prices, reduced corporate demand due to zoom and overhang of legacy credit issuance from the Pandemic Era.

Jarden reiterates SELL rating and target price is reduced to 65 cents - paywalled https://www.nzherald.co.nz/business/air-new-zealands-22-billion-recapitalisation-verdict-from-jarden-analysts/R3ZHSOEB7OY4GJCTMZUDDB42VY/
Dame Therese Walsh looks resplendent in Synlait Pink and Greg Foran has a colour matched tie, what could possibly go wrong ;)

Key Assumptions underpinning their "guesses", (not an exhaustive list by any means but just ones I wish to comment on)

From the middle of 2022, international travel (excluding China and
Hong Kong where international borders are expected to remain closed) is uninterrupted,
with no self-isolation restrictions and testing requirements easing for inbound and
outbound customers on Air New Zealand's key routes
Chance of another Covid variant causing further major disruption looks very real to me.

By 2025 aggregate passenger demand for domestic, Tasman and Pacific Islands travel will marginally exceed FY19 (financial year) levels, supported by network growth into those markets; and aggregate passenger demand for long haul will be slightly lower than FY19 levels (due to fewer ASKs flown overall), and have a more gradual pace of recovery relative to short-haul markets.
Completely overlooks the high probability that Covid has changed people's propensity for air travel

No long-term structural changes in travel behaviour or trends post-pandemic, including resulting from environmental sustainability concerns, health concerns related to Covid19, technological changes, or changes in customer preference.
I think this is ridiculous. There's no question doing business by Zoom or other digital platforms has become an accepted zero risk way of conducting business. Companies will be very reluctant to send senior executives on long distance flights due to the risks involved to key personnel and the risks of litigation. I think its safe to say the front end of the aircraft where the company makes a lot of its money is going to be affected materially for the foreseeable future. Its also clear there's rising awareness of the environmental impacts of jet travel.
AIR's assumptions here look fundamentally flawed to me.

Fuel prices are assumed to progressively reduce to $75 per barrel for the 2024 financial year.
Yes we'd all like that but its complete and utter guesswork and looks extremly optimistic.

Final comment - I used red because shareholders are going to have to get used to seeing a LOT of red ink in AIR's financial statements in the future !

[bassamrassam]

Thank you JTH. I thought the record date is when you buy them on the NZX. Or did I not get what you said correctly ?

[winner69]

What’s the market depth saying?

[Rawz]

What is this bad boy going to open at?

[Balance]

Shareshies crowd out in force at $1.37.

Going to be a fascinating day of learning for them!

[Maxtrade]

What is this bad boy going to open at?

Quite astounding the resilience of the current market depth with Cap Raise being more than double what was expected. Whats an extra Billion between friends right ;) Surely even retail folk can see what this size Cap Raise means. The resulting dilution of shareholders value. In one way forcing them to inject more capital at an offer to buy 2 shares for each share you currently own at a 'discounted Cap Raise offer' to try to make it look attractive. ie Cost averaging down as the share price will need to be low enough to be attractive to get funds through the cap raise. With no dividends in sight. Years away from breaking even let alone become profitable. Shareholders can expect to see previous low end trough of 0.70-0.80 tested for sure. Will be surprised if there is not a massive sell down ahead of Cap Raise. As post this massive unprecedented (in NZ) cap raise there will not likely be any reason for share price to rally, so those looking for a quick buck off buying in at cap raise offer and selling to make 10-20% won't be interested as likely will at best see SP plateau at Cap Raise price, or slowly decline, as most Cap Raise offers have seen in recent times. As many of us were suggesting on this thread for a long time, blood batch to share holders in the water. Surprised with so much pre warning there wasn't already a mass exodus. Those hat live in hope I guess. But no body expected the raise to be this big. Most analysts are recommending their fund managers downgrade and sell off / reduce current portfolio exposure. Will be interesting to see where Cap Raise price is set and how long support remains in market depth until everyone understands the reality of this 2 Billion dollar 'fund raising campaign' (to pay debt!) that has just been announced.

[Sideshow Bob]

Shareshies crowd out in force at $1.37.

Going to be a fascinating day of learning for them!

640k through at $1.37......What the F.....

[ordop]

This has to be New Zealand's version of GameStop. Very early days but it appears many ordinary New Zealanders still have plenty of dollars to burn...

[iceman]

640k through at $1.37......What the F.....

This is incredible ? What am I missing here ?

[percy]

This has to be New Zealand's version of GameStop. Very early days but it appears many ordinary New Zealanders still have plenty of dollars to burn...

Took years for NZders to return to the market after 1987 crash.
Now they are back for more,.
Sad to watch.

[ordop]

this is a transfer of ownership from the informed to the uninformed - although they have had plenty of opportunity to be informed.

[Sideshow Bob]

13660

From NZ Investors FB page. Around half think it is a good deal.....

[Waltzing]

"This is incredible ? What am I missing here ?"

it used to be called

"The fool at the table"

[ordop]

dropping now, the uninformed are spent.

[JohnnyTheHorse]

Should get into a faster fall once we clear through this initial bid volume imo.

[Popeye]

Well, this is going to be entertaining. Back in March 2020 I was watching AIR for a possible risk opportunity at 30-50c. I have watched in amazement at the SP ever since, quite the education in the awesome power of belief.

Now we are at what Alex Ferguson used to call "squeaky bum" time for anyone holding AIR. I am happy to be on the sidelines.

[Dlownz]

If I had shares and I was eligible for the shares from yesterday. I'd sell out now. Buy the cheap ones and sell them too. Buying in once the price sinks to 90 cents. Its got sky TV all over it

[warthog]

Took years for NZders to return to the market after 1987 crash.
Now they are back for more,.
Sad to watch.

But fascinating.

[Beagle]

My opinion is the rights are worthless and this will struggle to hold 53 cents towards the end of April and if it does so it will only be through underwriters supporting the share price. Watch for a big fall towards 53 cents over April and then in May it may go under 50 cents as the underwriters dump stock they were forced to accept under their underwrite agreement. This has Feltex written all over it, yet another Forsyth Barr "success" story

[Waltzing]

Nose is angled down....

"Its got sky TV all over it"

no comparison... this is much worse.

[Arbroath]

Quite astounding the resilience of the current market depth with Cap Raise being more than double what was expected. Whats an extra Billion between friends right ;) Surely even retail folk can see what this size Cap Raise means. The resulting dilution of shareholders value. In one way forcing them to inject more capital at an offer to buy 2 shares for each share you currently own at a 'discounted Cap Raise offer' to try to make it look attractive. ie Cost averaging down as the share price will need to be low enough to be attractive to get funds through the cap raise. With no dividends in sight. Years away from breaking even let alone become profitable. Shareholders can expect to see previous low end trough of 0.70-0.80 tested for sure. Will be surprised if there is not a massive sell down ahead of Cap Raise. As post this massive unprecedented (in NZ) cap raise there will not likely be any reason for share price to rally, so those looking for a quick buck off buying in at cap raise offer and selling to make 10-20% won't be interested as likely will at best see SP plateau at Cap Raise price, or slowly decline, as most Cap Raise offers have seen in recent times. As many of us were suggesting on this thread for a long time, blood batch to share holders in the water. Surprised with so much pre warning there wasn't already a mass exodus. Those hat live in hope I guess. But no body expected the raise to be this big. Most analysts are recommending their fund managers downgrade and sell off / reduce current portfolio exposure. Will be interesting to see where Cap Raise price is set and how long support remains in market depth until everyone understands the reality of this 2 Billion dollar 'fund raising campaign' (to pay debt!) that has just been announced.

Cap raise is not twice what was expected...only raising $1.2b of actual equity, the other $1.0b is just rearranging debt funding although the preference shares will likely convert to equity to be fair as the operational performance is unlikely to be good enough to avoid that...

wait a couple of weeks and the rights will probably be 10 cents or so...agree why own when a potential dividend is 4 years away and there are so many variables, like oil prices and customer travel patterns, that are far from certain....might interest me around 50 cents....maybe

[Maxtrade]

this is a transfer of ownership from the informed to the uninformed - although they have had plenty of opportunity to be informed.

100% Sad for retail investors who might not understand what's happening here.

Cap Raise 0.53, 2 for 1

Where do you think SP is heading!

Will see big sell off by close tomorrow. Glad we sold all out of our portfolio prior as mentioned quite some time ago previously in thread.

[snigmac]

What are people's thoughts of a consolidation after the cap raise?

[Beagle]

I'm calling it. The assumptions in the capital raise are absolutely ridiculous and wildly optimistic. Fair value is only 25 cents, SELL !

Hope the underwriters have their sub underwrite agreements all water tight and iron clad.
Can't help myself speculating if one of the sub underwriters is the Crown ?

[Rawz]

Dropping like a stone now.

Cant believe $2m odd traded in first 15mins with little sp movement

[Waltzing]

The SHAZ wont understand a word being said here....

SHAZ HQ promotes shares like they are a Prezzy Card...

[Rawz]

The SHAZ wont understand a word being said here....

SHAZ HQ promotes shares like they are a Prezzy Card...

Sharesies at least put out a disclaimer this morning that they were being paid by Air NZ to promote the offer.
Now no worries when they run their $100 prezzy card price draw for those that make a top up to their account (just in time for the cap raise)

[ordop]

I know you equities guys won't care too much but I'll be fascinated with how AIR successfully price and sell $600m of debt in the middle of this year. The margin to swap is going to be horrendous.

I reckon Air will close tomorrow evening about $1.14 which is a $0.20 rights price. Then with rights trading it will go down closer to the end of April as people have to front up with coin.

[Waltzing]

Since the SHAZ dont own the shares they really arnt shareholders anyway.

They wont actually think they lost any money. Just a little pastel colour on the page.

Bit like being at the races or a pokey... its just a bit of fun and wow! a Prezzy Card!

How good is this!

[ordop]

Sharesies don't participate in pre open apparently so the broker stats will show it wasn't them on the open - probably ASB or DBL. Sharesies enter the market after the NZX opens so their buyers will have been supporting the bid thereafter.

[Beagle]

I know you equities guys won't care too much but I'll be fascinated with how AIR successfully price and sell $600m of debt in the middle of this year. The margin to swap is going to be horrendous.

I reckon Air will close tomorrow evening about $1.14 which is a $0.20 rights price. Then with rights trading it will go down closer to the end of April as people have to front up with coin.

Good point and I have been wondering about the interest rate too. I would think it would need to be at the very minimum 500 basis points above swap to be somewhat attractive but even then, this is a very volatile industry so maybe 600 points ? I guess there is some comfort to be taken in that bond issue from the fact the Govt cannot allow the company to collapse as it provides vital transport infrastructure to the economy so if a second capital raise is required, (and I think that's a very real chance), they will have no choice but to participate and if necessary underwrite it. Maybe 8-9% isn't a bad fixed interest investment ? Certainly the bonds are far more attractive prospect than the shares, there's no question about that !

[Maxtrade]

Astounding how many folk just ignored all logic and supported SP at last months price. It was 100% guaranteed what is taking place today. Plenty of pre warning. Why wait until the news iOS out then take action and sell as we are seeing currently. Market behaviour is foolish and illogical sometimes. Now there will be a race to the bottom. With a couple of pauses and short minor rallies on the fall where hopefuls think a bottom has formed and buy back in, only to see it take another dive. Everyone has their own opinions so best of luck to holders. But newbies might want to consider exiting their positions as this fall is going to be substantial. Still a long way to go from SP 1.26 down to 0.53 Cap Raise price. Thats a huge loss for those heavily invested. Bet the shorts out there this morning and rubbing their hands together. Starting to see sell momentum build currently, touching on 10% drop in an hour soon. Amazing it took this long for people to realise this has been a SELL for so long.

[ordop]

Probably right with 8% and an implicit Govt Guarantee. Depends obviously on subordination so could be a bit less like 7%. This is like a 'ghost plane' - it's going down on fumes but no one knows where or when it's hitting terra firma.

[Beagle]

The sharsies crowd are dancing...What could possibly go wrong, there's no risk here :lol: https://www.youtube.com/watch?v=KwxUdT0pMZc

[JohnnyTheHorse]

Sincere apologies to the people I sold a truckload short to on open :)

[Ggcc]

I am surprised to see one of my friends kept holding onto AIR after I mentioned this would happen. I dare not ask him how he is doing today, as this would rub salt in the wounds. He bought lots around $1.40-1.45.

[Arbroath]

Good point and I have been wondering about the interest rate too. I would think it would need to be at the very minimum 500 basis points above swap to be somewhat attractive but even then, this is a very volatile industry so maybe 600 points ? I guess there is some comfort to be taken in that bond issue from the fact the Govt cannot allow the company to collapse as it provides vital transport infrastructure to the economy so if a second capital raise is required, (and I think that's a very real chance), they will have no choice but to participate and if necessary underwrite it. Maybe 8-9% isn't a bad fixed interest investment ? Certainly the bonds are far more attractive prospect than the shares, there's no question about that !

Theoretically they should be a BBB which is the same as Contact or Meridian etc but somehow I don't think they'll get an issue away anywhere near the spread a power company would...why would any sane person own AIR debt at 4.5% instead of a power company that is also 51% Govt owned with far more stable cashflows.

Need at least 6%+ yield imho given agree the Govt will continue to underwrite the situation

[Beagle]

Theoretically they should be a BBB which is the same as Contact or Meridian etc but somehow I don't think they'll get an issue away anywhere near the spread a power company would...why would any sane person own AIR debt at 4.5% instead of a power company that is also 51% Govt owned with far more stable cashflows.

Need at least 6%+ yield imho given agree the Govt will continue to underwrite the situation

They will have to model it based on the credit spreads other airlines are paying overseas. As you quite rightly suggest there's far more to it than just the official credit rating.

[bull....]

they have to milk the punters to ever pay a good div again with that many shares on issue

[ordop]

In answer to someone's question re a consolidation at some stage. Yes there will be one, almost certainly, but it won't be for a year or so after the share price has settled at a much lower level. Much like SKY TV have done.

[sb9]

Gee, doesn't seem that long ago we were talking about the special 25c div from Virg sale plus the normal div of 10c and I had accumulated about 120,000 shares to get this massive payout, which I was against, because the sp dumped for a while after that. Then a while later we cornered Chris Luxton at a meeting to ask him if the RR engines were going to drop off the planes. :confused: I think he thought we were joking and had a bit of a laugh. Ahh the good old days will come back one day, give it a bit of time;).

For sure, remember those good old days under Luxon's leadership. Checking through my spreadsheet my last sale was at $3.35 in May 2018. Never been back on the register since.

[Beagle]

I expect once the Asian markets open up overseas investors will deal to any available buy depth.

I remember many, many years ago asking at one annual meeting of AIR if the company was considered to be cyclical or not :lol:
Quite obviously back then this hounds nose was highly addicted to sniffing aviation fumes to the point I couldn't think straight :lol:
Asking if this is a cyclical is like asking if the Pope is a Catholic :lol:

[stoploss]

I expect once the Asian markets open up overseas investors will deal to any available buy depth.
I doubled my short this am astounded it went from $1.22 to $1.30 just had to sell some more. I just hope I haven't got this terribly wrong. I normally step back if i don't understand something .However this looks like a sure bet ....time will tell.

[Beagle]

I doubled my short this am astounded it went from $1.22 to $1.30 just had to sell some more. I just hope I haven't got this terribly wrong. I normally step back if i don't understand something .However this looks like a sure bet ....time will tell.

As sure as the sun coming up tomorrow mate. You can sleep well tonight.

[Bob50]

It has not just been the sharsies buying up these recently.
Direct broking clients had it as the 2nd most popular share for their clients to buy up to the week ending 18/3/22 and it’s popularity increased to 1st for the week ending 25/3/22.

[winner69]

Might get back into the 130s by end of day

So so so cheap

[Maxtrade]

I doubled my short this am astounded it went from $1.22 to $1.30 just had to sell some more. I just hope I haven't got this terribly wrong. I normally step back if i don't understand something .However this looks like a sure bet ....time will tell.

Are there that many gullible folk who would think that was it 1.17 the low, and rally up from there. Mind boggling. Are they aware Cap Raise is looking like will be set at 0.53c with a 2 for one offer to existing share holders. Who on earth is buying and why?

[LaserEyeKiwi]

Wow - what is going on. At least those with half a clue have had a good opportunity this morning to sell at a good price. But still - this is pure insanity keeping this turd airborne at this price.

[JohnnyTheHorse]

Wow what a trading day! Shorted on open, covered $1.25-26, reloaded $1.29-30, covered $1.18-19, reloaded $1.25-6, covered $1.20... Now waiting for another reload :t_up:

[stoploss]

Are there that many gullible folk who would think that was it 1.17 the low, and rally up from there. Mind boggling. Are they aware Cap Raise is looking like will be set at 0.53c with a 2 for one offer to existing share holders. Who on earth is buying and why?

I don't know that's what has me worried.... "the market can stay irrational longer than you can stay solvent " comes to mind with my short . Might have to be a bit more like
JTH and be more nimble .......